Developing countries that support Russia or Iran could lose EU aid and European companies may receive preferential treatment in funding procurement in future, the EU’s foreign policy chief Kaja Kallas said on Monday.
Speaking ahead of a meeting of EU development ministers in Brussels, Kallas said the bloc needed to become “more strategic” in the way it funds foreign aid in an era of greater geopolitical rivalry and conflict.
“If a partner supports Russia or Iran, then it has to be flexible so that we can realign our engagement in this case,” she said.
Kallas did not specify how exactly any new flexibility would be incorporated into policy.
“It’s a very careful balance … not withdrawing it all, but also keeping in mind that Europe has interests,” she said.
“If we have projects to support the countries, and actually, it goes to our competitors, then we also have to see how we can look into this.”
The remarks come as EU leadership is drawing up the future of the bloc’s €300 billion geopolitical investment strategy, Global Gateway, in the next seven-year EU-budget. There has been controversy over an EU-backed project in Senegal worth upwards of €320 million that looks set to be awarded to a company with ties to the Chinese government, previously found to be in violation of the bloc’s rules on foreign subsidies.
Jozef Síkela, the EU’s development commissioner has said that European preference should be baked into future EU development aid. “In the world where investments, infrastructure and supply chains have become an instrument of power, foreign policy cannot be sentimental,” he said on Monday.
MEPs have warned against tying EU aid to EU companies, setting European competitiveness above poverty eradication.
Maxime Prevot, the Belgian foreign minister, warned that the EU must not pull out of aid for the developing at a time when the US was cutting assistance.
“Europe must not leave a void … in which case others will take the place with an even more transactional approach,” he said.